Publication Date: July 1, 2012
What the FED hailed as “The Great Moderation” has left the middle class to take on a lifetime of bank debt to obtain access to housing, education to get a job, an auto to drive to it, and simply to maintain living standards that wages and salaries no longer support. What has derailed the economy is the take-over of academic economics and politics by the financial sector in order to censor criticism and misrepresent statistics so as to give the impression that the economy can “borrow its way out of debt.”
The reality is that income used to pay down today’s debt overhead is not available to be spent on goods and services. The result is debt deflation, followed by austerity and the the “fire sale” or decay of infrastructure at the national and local levels. The most controversial claim by Prof. Hudson is that “Debts that can’t be paid, won’t be.”
The question he poses is whether their non-payment will lead to worldwide foreclosures – including sell-offs of the public domain by debt-strapped local and national governments – or whether they will be written down in line with the ability to pay. This is the economic issue that will dominate politics over the next generation. Illustrated with charts and exhibits that make it plain where money goes versus where it should go.
Michael Hudson is President of The Institute for the Study of Long-Term Economic Trends (ISLET), a Wall Street Financial Analyst, Distinguished Research Professor of Economics at the University of Missouri, Kansas City and author of The Bubble and Beyond (2012), Super-Imperialism: The Economic Strategy of American Empire (1968 & 2003), Trade, Development and Foreign Debt (1992 & 2009) and of The Myth of Aid (1971).
ISLET engages in research regarding domestic and international finance, national income and balance-sheet accounting with regard to real estate, and the economic history of the ancient Near East.
Michael acts as an economic advisor to governments worldwide including Iceland, Latvia and China on finance and tax law. He gives presentations on various topics at conferences and meetings and can be booked here. Listen to some of his many radio interviews to hear his hyperspeed analysis of the geo-political machinations of global economics. Travel costs and a per diem are appreciated.
I’ve read most of Michael Hudson’s work on his web page and watched many of his interviews, but I haven’t read this book. I take it from the testimonials that it is a good book. My comments here reflect Hudson’s choice of how the book should be published.
Michael Hudson has stated in interviews that he is wealthy enough never to have to worry about his income and can devote his time to writing. Therefore, I can only conclude that his interest in writing the book is to expose his ideas to a wide audience. An expensive paperback without even a sample of the text in not consistent with this goal. Simply making the book available as a Kindle book would increase distribution dramatically, as well as the income from the book. It seems Dr. Hudson may have been concentrating unduly on macroeconomics and forgotten the microeconomics of maximizing distribution and profit through setting the right price point and media for publication. Either that, or he is not writing for a general audience, but for a small contingent of his clients and admirers that prefer books made from trees.